Announcing End of Year results for Skanska UK

Press release 07/02/2008 00:00 CET

Skanska UK Plc today announces its results for the year ending December 31st 2007.

Revenue for the year at £1308.8 million shows an increase of 44.3 per cent on the same period in 2006. Earnings before tax at £32.9 million shows a slight decrease on that at the previous year which included the exceptional gain from the financial closure and recovery of bid and development costs of the Barts and The London new hospitals redevelopment. Order book is slightly ahead despite 2006 having the benefit of Barts and The London.

David Fison, Chief Executive, Skanska UK Plc said, “2007 was an interesting year with sales growing over 40 percent and profits remaining flat. Clearly I would have liked profits to rise in line with sales and but for three projects they would have. We’ve got to put that right in the future.

“Otherwise we are firing on all cylinders and I’m immensely proud of the way my people have managed our growth.”

Operational highlights for Skanska UK Plc during 2007:

 David Tydeman joined the board of Skanska UK Plc as Executive Vice President. David was most recently Chief Operating Officer of Morrison Plc and had previously held a number of key senior positions in organisations such as Cap Gemini Management Consultants and Rolls Royce/Vickers plc.

 Skanska was honoured by the Considerate Constructors Scheme when it was presented with two awards as part of the Schemes 10th anniversary celebrations. The UK’s most considerate contractor in the Civil Engineering Category and a second place award in the overall category of “The UK’s Most Considerate Constructor”, given to the highest performing companies in the UK.

 Skanska continues to drive its Health and Safety Strategy towards its vision of Zero Harm. The emphasis remains on prevention of accidents, with much effort put into its partnership with Mencap and Enable, Safety@Skanska, to improve the reporting of all unsafe conditions and actions across its sites and offices.

To support this, during the year the business decided to begin the transition from recording an Industry standard Accident Incident Rate (AIR) to a Total Case Incident Rate (TCIR) thereby providing Skanska UK a more accurate picture so that it can focus on those areas which will enable its strategy.


 At the beginning of 2007, Skanska in partnership with GrantRail was awarded a £39 million project by Transport for London to carry out major civil engineering works for the new Docklands Light Railway (DLR) extension to Stratford, known as Package 8.

This was followed in July, by the award of a further contract, Package 6, which includes the conversion of the former North London Line railway between Stratford International to Canning Town, upgrading existing stations to DLR standards. Work includes the construction of four new stations and the formation of a new DLR link between Stratford and Stratford International. Package 6 is valued at £67 million, both schemes are part of DLR’s Stratford International extension, will play a key role in transport plans for the 2012 Games.

 In June, Skanska received an ECI award from Dorset County Council to carry out the design and construction of the A354 Weymouth Relief Road. The scheme, worth around £40 million, is designed the relieve congestion along both the A354 from Weymouth-Dorchester and the A353 to the east and surrounding residential areas.

 Utilities and Infrastructure Services - Following the acquisition of McNicholas Plc “Brown Macs” at the end of 2006, the 2007 focus was on the integration of Skanska McNicholas and Skanska UK’s existing utilities operations. The teams have now completed a very successful integration process and the combination of skills and expertise of the company’s new utilities operation makes Skanska one of the largest utilities and infrastructure services providers in the UK.


 In April, and by combining its commercial construction and mechanical and electrical engineering expertise, Skanska secured a £68 million contract to design and construct a new eight-floor office development at 20 Gresham Street in the City of London for Hermes Real Estate. Set for completion in September 2008, the building will offer 21,000m2 of net letable office space.

 Also in April, Skanska was awarded a £50 million contract by Land Securities - Dashwood EC2, also in the City of London. Work includes the partial demolition of an existing 15-storey office building and the addition of a further four floors to provide over 20,000m2 of gross prime fully serviced office space and 676m2 of retail space.

 In August, Skanska was awarded a £150 million contract to design and construct The Walbrook, a striking new office and retail development in the heart of the City of London. The project is for Minerva, for whom Skanska combined its in-house skills to offer an unrivalled combination of expertise, spanning design, construction, mechanical and electrical engineering, piling, and steel decking. Completion is scheduled for late 2009.

 In October, a Skanska team combining construction, mechanical, electrical, plumbing and IT services, piling, steel decking, suspended ceilings and engineering resource was awarded the contract to construct Heron Tower by the trustees of the Heron Tower Property Unit Trust. Located on an island site on Bishopsgate, when complete, Heron Tower will be one of the tallest towers in the City of London. The project is scheduled for completion during the first quarter of 2011.

 In November, Skanska Innisfree reached Financial Close for the delivery of a 33-year PFI scheme to design, build, finance, and operate a major healthcare development in Walsall – Manor Hospital. This project, for the Walsall Hospitals NHS Trust, includes a construction contract worth around £174 million. Skanska Infrastructure Development is co-owner of the special purpose company holding a 50 per cent share Innisfree also holds a 50 per cent share of the company.

 Work to deliver four new schools under the UK’s first Building Schools for the Future Programme entered an exciting stage as the team handed over the first school, Bristol Brunel Academy (formerly Speedwell), in time for the start of the new school term in September.

A copy of Skanska AB’s results, also released today, can be found at www.skanska.com.